Trivia: The "Annabelle" doll seen in the opening sequence of the film was actually a regular "Raggedy Ann" doll in the real-life story that inspired the scene. The doll was redesigned to its current, much more grotesque form for several reasons: First, to make it more cinematic. And second, to avoid legal troubles with the copyright holders on Raggedy Ann. The filmmakers and Lorraine Warren also stated that they were interested in re-designing the Annabelle doll because they were afraid if they used a real Raggedy Ann doll, it would frighten children who might own them.
Trivia: The film is loosely inspired by a real-life paranormal investigation by investigators Edd and Lorraine Warren, though new elements were added to the story in order to make it more cinematic.
Answer: She was a witch that committed suicide. Before, she cursed everyone who set foot on her property.